The next GST Council meeting is scheduled for 14 March, 2020 at New Delhi. It will, inter alia, take up the issue of compensation to states in the backdrop of revenue shortfall. States are already concerned over delayed release of compensation cess to them. Meanwhile, centre has already released a total of Rs. 1.20 lakh crore as compensation to States in 2019-20(as against Rs. 78874 crore collected so far).

The time period (including extended slots) for filing GST annual returns (Form 9 and 9C) for the financial year 2017-18, first year of GST got over last week on 12th February, 2020. Those who could not file can file even later and without late fee. A total of 42.03 lakh taxpayers filed GSTR-9 and 9.46 lakh taxpayers filed GSTR-9C (audit). Over 90% of eligible taxpayers filed such returns. Maharashtra was on top with 96%. The utility for filing returns 9 and 9C for financial year 2018-19 is now available on GSTN portal, last date for which as of now is 31st March, 2020.

The interest on delayed GST payment in still payable on gross amount. The Finance Act No. 2 of 2019 passed in July amended Section 50 of the Central GST Act, 2017 which deals with interest on delayed payment of GST dues by a taxpayer or an assessee under GST laws. This amendment added a proviso to section 50, which said that the interest on delayed payment of GST dues should be charged only on the net tax liability and not the gross tax liability. The CBIC, in a series of tweets on February, 15, said that the Centre and many States have amended their GST laws in a way that interest is charged only on the net tax liability and this amendment will only be prospective, after it is notified.

CBIC has also decided to adopt e-assessments, i.e., faceless assessment. Soon imported goods will go through faceless assessment. This will mean custom officers sitting in any part of the country will assess documents of importers at any port. This is expected to bring anonymity in assessment and reduce the physical interface between the Assessing Officer and the importer/broker to a large extent.

In yet another development, Telecom companies, which are already sailing in troubled waters, may face another jolt in the form of tax obligation on adjusted gross revenue (AGR) dues. The telecom companies have received notices from the tax department for the payment of service tax and GST on their AGR dues.

CBIC to recover interest on delayed GST payment

  • The Central Board of Indirect Taxes & Customs (CBIC) has through Special Secretary and Board Member written to all principal GST Commissioners to collect interest on account of delayed payment of the Goods & Services Tax (GST).
  • As per law, the tax payer has to assess and pay interest on delayed payment of GST.
  • The interest liability has to be paid on the tax liability that is paid belatedly, either through cash or utilisation of input tax credit (ITC).
  • The interest has to be paid on the total tax liability as shown in GSTR 3B.
  • The interest payable on such tax payment can be recovered through various methods.

[Source : As reported in Business Line dated 13.02.2020]

Interest to be charged on Gross Tax Liability or Net Tax Liability?

CBIC has clarified in respect of some social media feeds on gross/net tax liability for interest payment. Accordingly,

“There are some discussions in social media w.r.t. interest calculation on delayed GST payments post a few media reports regarding Rs. 46000 Crore interest on the delayed GST payments to be collected by tax authorities. On this issue of interest calculation, it is clarified that-

The GST laws, as of now, permit interest calculation on delayed GST payment on the basis of gross tax liability. This position has been upheld in the Telangana High Court’s decision dated 18.04.2019 in the case of Megha Engineering and … vs The Commissioner Of Central Tax.

In spite of this position of law and Telangana High Court’s order, the Central Government and several State Governments, on the recommendations of GST Council, amended their respective CGST/SGST Acts to charge interest on delayed GST payment on the basis of net tax liability. Such amendment will be made prospectively. The States of Telangana and West Bengal are in the process of amending their State GST Acts. After the process of amendment is complete, the changed provisions can be put in operation for the entire country.”

[Source : Recent CBIC Tweet ]

GSTR-9 and GSTR-9C for Financial Year 2018-2019

  • GSTN has enabled the option to file the returns GSTR-9 and GSTR-9C for the financial year 2018-19 on its portal.
  • GSTR-9 can be filed online. It can also be prepared on offline tool and then uploaded on the portal and filed.
  • Annual return in form GSTR-9 is required to be filed by every taxpayer registered as normal taxpayer during the relevant financial year.
  • All applicable statements in Forms GSTR-1 and returns in Form GSTR-3B of the financial year shall have been filed before filing GSTR-9.
  • In case you are required to file GSTR-9C (Reconciliation Statement and Certification); shall been filed before filing GSTR-9.
  • Taxpayers can download the system generated / computed draft annual return.
  • ‘NIL’ GSTR-9 Return can be filed, if taxpayer has:
    • Not made any outward supply (commonly known as sale); and
    • Not received any inward supplies (commonly known as purchase) of goods/services; and
    • Not liability of any kind; and
    • Not claimed any credit during the Financial Years; and
    • Not received any order creating demand; and
    • Not claimed any refund.

during the Financial Year

[Source: GSTN Portal]

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December 2020